Transcript Slide 1

Next Steps for Refocusing Vocational Training in Victoria –
Supporting a Modern Workforce
Presentation to VISTA Association of VET Professionals, 9 April 2013
Kym Peake, Deputy Secretary, Higher Education & Skills Group
1
Victoria’s VET system has been on a reform trajectory, to overcome the
limitations of a centrally planned provision model
early 1990s
Profile funding
No market
TAFE budget funded
through contract
TAFE attracts students
Profile of activity funded
mid 1990s - 2000s
Purchaser- provider
Portion of funding
contestable
Government purchased
places, mostly with TAFE
Planned course provision
with capped places
Subsidy based on historical
cost
Fees regulated/capped
Regulated fees
Goal: Funding
Goal: Drive
2008 - 2012
Student entitlement
Open contestable market
Student entitlement and
choice of provider
Uncapped places
Subsidy based on course
cost
Fees regulated/capped
Goal: Meet student
demand
2012 Refocusing VET
Fully contestable market
Student entitlement and
choice of provider
Uncapped places
Subsidy reflects supplydemand and public value
Flexible fees
Goal: Modern system
based on choice and
competition
efficiency
TAFE
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Over the past 12 months we have been implementing system-wide reforms
to improve the design and operation of Victoria’s training market
Entitlement
Fundamentals
retained
Diversity of Providers
Differentiated Subsidies
Unbalanced public investment
Supply-driven system
Gaps
addressed
•Victorian Training Guarantee retained
•Funding directed to providers who meet quality requirements
and attract students
•Lower subsidies for higher qualifications that deliver greater
private returns, but income-contingent loans so no upfront-fees
•Subsidies targeted towards real job pathways
•Deregulation of fees
•Concessions and loadings for effective participation
• Redesign of industry engagement
• Improved information to the market
Gaps in quality assurance and market
oversight
• Strengthened contractual requirements for RTOs
• Improved monitoring of provider and market performance
Government policy constraining
market-driven industry restructuring
• TAFE transition
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All aimed at building a training system that supports a modern Victorian
workforce
Our aims for Victoria’s training market:
 Helping as many people as possible to get a job
 Qualifications on offer provide pathways into careers
 Quality training is delivered
 Business and industry has access to the skills they need
 Government funding is targeted to areas of need
 Public money is spent efficiently
 The training system can adapt as learner and industry
needs change
4
Our changes are delivering positive outcomes for Victorian learners…..
Government sudsidised
Students
Hours (millions)
% change
2008-2012
% change
2011-2012
509,797
73%
18%
188.8
116%
28%
2008
2009
2010
2011
2012
294,671
299,602
339,226
430,280
87.4
95.6
112.4
146.9
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…including through an increase in TAFE enrolments…
TAFE
Government
subsidised
Domestic fee-forservice
Total
% change
20082012
% change
20112012
2008
2009
2010
2011
2012
253,468
251,079
263,337
263,460
281,392
11%
7%
89,382
100,844
103,664
102,185
124,871
40%
22%
342,850
351,923
367,001
365,645
406,263
18%
11%
Government subsidised enrolments rose by 7 per cent between 2011 and 2012
Domestic fee-for-service enrolments were up 22 per cent over the same period
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…helping to deliver skills that align with the jobs of the future
Enrolments in training
are aligned with the
changing industry profile
of the Victorian economy
and labour market
Since the introduction of the VTG,
there has been consistent
enrolment growth in specialised
occupations and occupations in
shortage
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New price signals introduced in July 2012 are already having an effect on
provider and student behaviour towards courses with greater public value
From July 2012, five subsidy bands were introduced based on assessment of public value of courses (eg. value to the economy
and cost of timing delivery). For example…
Band A
Apprenticeships
Band B
Foundation
Skills, Cert III
Aged Care
Band C
Diploma of
Children’s
Services
Band D
Diploma of
Graphic Design,
Events
Band E
Fitness, Process
Manufacturing
Proportion of commencing enrolments by subsidy band
2011 and 2012 preliminary data pre vs. post July commencements
Data from the second half of
2012 already shows positive
shifts in training uptake.
For example Bands A and B
account for 65% of post July
2012 commencements
compared with 49% pre-July
2011
9%
35%
24%
11%
21%
Band A
Band B
Pre July 2012
8%
41%
20%
10%
21%
Band C
Band D
Band E
Post July 2012
11%
0%
54%
10%
20%
30%
40%
22%
50%
60%
70%
80%
4%
90%
9%
100%
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The RVT reforms continue a long journey toward competitive neutrality and
operating and commercial autonomy for TAFE’s and Dual Sector Universities
1980s
Historical
TAFEs begin decade
administered by Dept
Control transferred to TAFE
Board
Victoria only State to
separate TAFE from Dept
Performance agreements
introduced
Profile funding
Goal: Separate TAFE
from other
education sectors
Mid 1990s – 2000s
Devolution
TAFEs established as selfgoverned statutory
authorities
Boards employ staff but
subject to multi-party
agreement
Limited commercial powers
Dual sector universities
created
Consolidation of specialist
colleges into larger multipurpose institutes
Goal: Greater
autonomy
2008 – 2012
Competition
Better define reporting &
accountability
Broader commercial powers
enabled
Transitional financial &
capacity building support
Enhanced broadband and
business systems
More partnerships with &
diversification into ACE and
higher education
Goal: Adjustment to a
more competitive
environment
2012 – 2013
Commercial
Smaller, skills-based Boards
Clear commercial
expectation & framework for
operations
Reclassification of dual
sector universities
Legacy constraints removed
Structural adjustment
support to build financial
sustainability & competitive
strengths
Goal: Full operational
and commercial
autonomy
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Since Refocusing Vocational Training, we have been working with TAFE
institutes on transition risks and opportunities
May 2012
June 2012
September 2012
Refocusing Vocational
Training in Victoria
Independent TAFE Reform
Panel established
Business Transition Plans
submitted
January to February 2013
December 2012
Government considered
the Panel’s advice
Reform Panel report
provided to Government
March 2013
Release of Government’s
response to Reform
Panel’s recommendations
2013 
Implementation
2014 and beyond
A strong, sustainable
TAFE sector
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The Government’s response to the Panel’s report is an important next
step in securing a strong and sustainable TAFE sector for the future
The TAFE Reform Panel made 19 recommendations. The Government fully supports 12 of these
recommendations, supports six in principle and does not support one.
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Reforms
Strategic
directions
Key reform directions – Commercial and Operating Autonomy
Clearer accountabilities and fit for purpose governance, monitoring & reporting
• Supply commercial objectives to provide a clearer understanding of
Government’s expectations
• Working with Chairs and Boards on:
• Modern constitutions, commercial guidelines & strategic planning
guidelines
• Reconstituting skills-based Boards
• Greater control over assets, including proceeds of sale
• More flexible borrowing arrangements (case-by-case)
• A new compact defining the relationship between TAFEs and DEECD
• Streamlined financial reporting and providing benchmark data
• Ceasing separate reporting on TAFE operations of Dual Sector
Universities
12
Reforms
Strategic
directions
Key reform directions – Commercial and Operating Autonomy
Removal of constraints
• Allowing TAFE institutes to take more control over workplace
relations
• Removing the restriction on TAFE institutes being registered as
Group Training Organisations
• Continuing to call on the Commonwealth Government to extend
streamlined visa processing for international students
• Continuing to support a wide range of choices for students in
higher education, including through TAFE/University partnerships,
and TAFE delivery of higher education courses
13
Strategic
directions
Key reform directions – Strengthening Regional TAFE provision
Sustainable solutions for rural and regional Victoria
• TAFE Reform Panel recommended integrated governance and
management structures for:
• Hume region: Wodonga and Go TAFE
• Gippsland region: GippsTAFE and Advance TAFE
Reforms
• Barwon South West region: The Gordon and South West TAFE
• Loddon Mallee region: Bendigo and Sunraysia
• While accepting greater scope and scale is required for financial security,
Government will not impose amalgamations on regional institutes
• Rather, regional institutes will chart their own course to financial
sustainability, supported by the:
• Appointment of independent facilitators to work across each region
• $150,000 for each TAFE to engage strategic advisors – either
individually or on a shared basis
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Strategic
directions
Key reform directions – Transitional funding support
Structural adjustment support
• $200 million contestable funding over 4 years to support innovation,
collaboration, structural reform and business transformation
Reforms
• $100 million for asset solutions to support better asset utilisation and
return on assets, and equip institutes to service loans and be selfsufficient in the future
• Focus on solutions that increase revenue, decrease costs and rightsize the institute’s asset base
• Examples - master planning, adaptive re-use, building
refurbishment and building replacements
• $100 million for business transformation activities, for example:
• Adoption of new business models
• Redesign of business systems and processes
• Self-identified structural reforms and other collaboration activities
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5. Other recommendations of the TAFE Reform Panel
Strategic directions
Funding review
Vocational pathways
review
Advocacy to the
Commonwealth
Actions
• Conduct a review of the initial impact of the new market
settings, focusing in particular on prices and access to
training.
• Conduct a review, part of the whole-of-department look at
youth engagement and successful transitions, and is assessing
the effectiveness and efficiency of vocational pathways for
senior secondary students with a particular view to resolving
issues regarding funding for VET in schools.
• The Government will advocate to the Commonwealth to
ensure that a wide range of choices for students in higher
education, including through vocational training providers.
• The Government will also continue to push for the extension
of streamlined visa processing to other appropriate settings.
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Questions?
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